Question: A study has been conducted to determine if one of the departments in Barry Corporation should be discontinued. The contribution margin in the department is

A study has been conducted to determine if one of the departments in Barry should be discontinued. The in the department is $60,000 per year. Fixed expenses charged to the department are $75,000 per year. It is estimated that $34,000 of these fixed expenses could be eliminated if the department is discontinued. These data indicate that if the department is discontinued, the company's overall net operating income would:
A) Decrease by $26,000 per year
B) Increase by $26,000 per year
C) Decrease by $15,000 per year
D) Increase by $15,000 per year

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